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Where Taxpayers and Advisers Meet

CGT on property abroad paid for in installments

spoonsfc
Posts:1
Joined:Wed Jul 31, 2019 3:43 pm
CGT on property abroad paid for in installments

Postby spoonsfc » Wed Jul 31, 2019 3:53 pm

Hi

I have/in process of purchasing a property abroad which I have been paying for in installments over the last 5 years. In these last five year the exchange rate as change significantly against GBP

Question is how is the capital gains tax calculated? Understand that the sale will be the GBP equivalent at the time of sale. However how is the purchase price calculated in GBP terms?

E.g.

Price at time of sale is equivalent to 30GBP

If agreed purchase price (5 years ago) was equivalent of 10GBP . However to due exchange rate fluctuations I have paid equivalent of 5GBP over the last 5 years.
Is the CGT on the profit of £20 or £25?

Sorry for simplistic example but just wanted to make sure I am explaining it right!

Thanks in advance

pawncob
Posts:5099
Joined:Wed Aug 06, 2008 4:06 pm
Location:West Sussex

Re: CGT on property abroad paid for in installments

Postby pawncob » Wed Aug 07, 2019 3:39 pm

If purchased in instalments, each tranche is converted at the exchange rate at that time.
(Your example makes no sense)
With a pinch of salt take what I say, but don't exceed your RDA


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